The Sudanese pound continues its sharp decline, reaching record lows nearing 5,000 pounds to the dollar. This has triggered a new wave of price hikes and caused the currency to lose a significant portion of its value. This has directly impacted people's livelihoods, with 86% of families now unable to meet their basic needs, according to the International Organization for Migration. The suffering is evident in the simplest necessities; for example, filling a gas cylinder now costs around 120,000 pounds, an amount exceeding the salary of a ninth-grade teacher, 86,000 Sudanese pounds, while the first-class salary of 225,000 Sudanese pounds is not enough to cover the family’s bread needs for one month!

The Sudanese pound has lost nine times its value against the dollar and other currencies, shedding 90% of its worth. The dollar has jumped from 570 pounds in 2023 to 4,700 pounds currently, with reports suggesting it could reach 5,000 pounds. The Saudi riyal has risen from 200 pounds to 1,050 pounds, and the Egyptian pound from 13 Sudanese pounds to 98 pounds.

This dramatic currency collapse has had a profound impact on prices and purchasing power. Prices of goods have increased tenfold; for example, the price of a gallon of gasoline has jumped from 3,000 to 30,000 pounds. Meanwhile, the value of wages has plummeted. Teachers’ salaries, which were equivalent to between $181 and $498 a few years ago, are now worth only $17 to $84, even though their nominal value in pounds remains between 86,000 and 225,000 Sudanese pounds.

The primary cause of Sudan’s economic crisis lies in the implementation of a capitalist economic system with its well-known tools of taxes, customs duties, and monopolies. Fees and taxes now constitute approximately 70% of commodity prices, while the customs exchange rate has risen from 2,000 to 3,222 Sudanese pounds since the beginning of 2025, an increase of 61%. With the importation of certain goods monopolized by specific entities that control their prices, the inevitable result is soaring prices and widespread hardship for the population.

The reasons for the currency collapse can be summarized in three main points. The first is the chronic trade deficit, with Sudan’s exports amounting to approximately $2.6 billion compared to imports of $6.5 billion, resulting in a deficit of nearly $3.9 billion. Whenever imports exceed exports, the demand for foreign currency to finance imports increases, driving up the price of the dollar and depreciating the value of the local currency.

Yet, Sudan is not a resource-poor country to suffer from this deficit. It is one of the largest gold producers in Africa, and produces most of the world’s acacia gum, in addition to its vast agricultural, livestock, and mineral resources. However, corruption and government policies that undermine production have deprived Sudan of truly benefiting from these riches. A prime example is the gold sector. The Minister of Finance announced that Sudan’s production in 2025 reached approximately 70 tons, while only 20 tons were officially exported. Despite government oversight of gold production, some was exported, while the remainder ended up in the pockets of officials. If only these 70 tons had been exported, without any other production, Sudan's exports would have reached $9 billion, resulting in a trade surplus of $2.5 billion. Furthermore, the government’s tax and revenue policies were the destructive force that undermined production; the numerous taxes and fees crippled the foundations of production in both agriculture and industry.

Undoubtedly, the current war has exacerbated the crisis, but it is not its true origin. The decline of the Sudanese pound and the rise in prices predate the war by many years. However, the wartime conditions provided the government with an opportunity, akin to “creative chaos,” to implement economic measures that would be difficult to implement under normal circumstances, such as currency devaluation.

The second reason for the Sudanese pound’s decline lies in the nature of the monetary system itself. Currency is merely fiat currency, lacking a solid foundation. The state prints it whenever it wants without backing, and it is well known that increasing the money supply leads to inflation, which devalues ​​the currency and erodes people’s hard-earned savings.

The third reason is the implementation of the International Monetary Fund’s destructive economic conditions, including currency devaluation. The IMF demands that countries devalue their currencies against the dollar for colonial purposes, aiming to plunder their resources.

Government measures, however, only address the symptoms, not the root causes. The government initially blamed fuel importers for the price hikes and announced it would handle imports directly through its ministries. Two days later, it reversed its decision and demanded importers deposit 200 kilograms of gold to obtain import permits, a move that reflects the government’s chaotic approach.

It’s noteworthy that the state is already heavily involved in the fuel market. Four government-owned companies import approximately 50% of the total fuel, while 38 private companies share the remaining half.

Furthermore, the government imposes a 31% tax on each liter of gasoline and state-level fees of up to 500 pounds per liter for interstate transport. The government’s capitalist tax policies are the primary cause of increased hardship and higher fuel prices.

To maintain the value of the pound, it must be backed by a stable and robust foundation: gold. Printing currency without gold reserves is unacceptable. With a gold standard, the pound will have intrinsic value, eliminating the need for people to convert their savings into dollars or other currencies for fear of devaluation.

The fundamental solution to Sudan’s economic problems lies in implementing an economic system based on the Shariah rulings of Islam, which originate from the All-Wise, the All-Knowing (swt). This system would utilize Sudan’s resources and empower its people to benefit from them through production, industry, and trade. It would also sever the influence of the International Monetary Fund and the World Bank, institutions based on riba (interest), from interfering in economic policies, preventing them from devaluing our currency. Furthermore, it would eliminate the colonialist dominance of the dollar over our country and establish a stable monetary system based on the gold standard.

Gold has been the basis of currency for thousands of years, and Islam affirmed this hukm, linking a number of rulings to gold. It is a stable foundation, as the value of gold remains virtually unchanged due to its precious nature. This system requires a Khilafah, as the current agent regimes are incapable of implementing it.

*Council Member of Hizb ut Tahrir in Wilayah Sudan